Virginia drivers finding new ways to save money, remain insured

As the current economy forces families to look for ways to trim expenses, AAA Mid-Atlantic reports that many Virginia drivers are reducing auto coverage or raising deductibles.
AAA Insurance, however, warns that having too little or no auto insurance could possibly result in an “even worse situation.”
“We have more uninsured and underinsured drivers on the road right now,” Steve White, insurance counselor for AAA Mid-Atlantic, said in a news release. “Families looking to save money in these tough economic times can find plenty of ways to lower insurance premiums without putting anyone in legal or financial jeopardy.
“Automobile insurance is not just a necessity, but a legal obligation.”
Rachel Schoonover, a local Nationwide agent, said over the last six to eight months she has seen about 20 percent of her customers increase both their auto and homeowners insurance deductibles in an effort to save money, but suggests people look into combining policies as a better way to save.
“There isn’t much of a savings with increasing auto deductions, but combining home and auto coverage can provide a significant savings of up to 25 percent,” she said.
Nationwide has always offered a review of policies to customers, but Schoonover said now more and more people are taking advantage of it.
Bob Thompson, owner of Thompson Insurance Services in Chatham, said that people changing their auto insurance is just a “sign of the times.”
“I have always pushed for higher deductibles,” he said Wednesday. “It’s a good financial decision in all insurance. I call it ‘self-insurance’ where you insure the first $500 to $1,000 and you assume part of the risk.”
Thompson said he started seeing customers last year and even before then combining their auto and homeowners policies as they looked for ways to save money.
He also recommends that people review their policies for other cost-reducing changes.
“For example, a couple with three cars might be paying for a rental reimbursement, but if they have the extra car, they don’t need that,” he said. “There are also seven or eight different discounts people can get on their auto policies if they will apply for them.”
Besides asking about discounts and increasing the deductibles, AAA also recommends checking your mileage and seeing if a less-than-average mileage might qualify for a lower rate; shopping around and comparing rates at different companies, although least expensive doesn’t insure the best service; and adjust-ing coverage on older cars.
AAA also says to keep in mind if you have a loan on your vehicle, you probably won’t be able to drop your collision or comprehensive coverage. Also make sure that you can afford the costs of replacing a car if you drop coverage.
In Virginia, drivers who do not have insurance must pay a $500 Uninsured Motor Vehicle fee, according to the Virginia Department of Motor Vehicle Department Web site. Payment of the fee does not provide insurance but simply allows a person to drive a car at their own risk; it expires with the vehicle’s registra-tion.
The DMV is provided with electronic updates from insurance companies when a motorist’s insurance coverage changes or is cancelled. Substantial penalties and fees are applicable if a driver does not have insurance and hasn’t paid the Uninsured Motor Vehicle fee.


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